A recent audit of the beverage category conducted by the Beverage Marketing Corporation shows that carbonated soft drinks and fruit drinks are growing their market share among an important target audience for milk — kids.

As other beverages more aggressively target young audiences (kids and teens), milk could experience an erosion in consumption patterns at an earlier age, which would adversely affect life-long consumption patterns.

According to the study, if current trends continue, by 2010, per capita consumption of milk among kids ages 6-12 will be just 17 gallons, down considerably from 26 gallons per capita in 2000 — a 35% drop. In addition, BMC predicts that decline in consumption among kids would continue throughout all life stages.

“We need processors to think about building long-term product loyalty early by focusing more on kid marketing,” said Corinne Schwartz, director of marketing for International Dairy Foods Association. “Competition is increasing with the proliferation of nutrient-fortified beverages. At the same time, we have few products targeted to kids and youth, limited reach through advertising, and limited out-of-home distribution. This all makes it difficult for milk to compete well with other beverages, but we know we can do better.”

According to BMC, bottled water and fruit juices are stealing youth market share with kid-appealing products and packaging, and these products are increasingly being fortified with nutrients like calcium. Additionally, bottled water and soft drinks are increasing its teen market share by increasing channel distribution, such as through vending and non-traditional channels like health clubs. Carbonated drinks are also offered in new, inventive flavors and are more teen-focused to help establish long-term product loyalty. What's more, advertising and promotion spending levels are higher now than ever across all beverage categories.

BMC's audit recommends ways that processors can enhance their reach to kids and teens through expanded target-appropriate product offerings, better away-from-home availability in channels that are also target-specific, increased branding, and enhanced image and promotion.
The audit was presented earlier this month at the Milk Processor Education Program (MilkPEP) Board Meeting. For more information, contact Corinne Schwartz at cschwartz@idfa.org or call (202) 220-3548.